We recently helped a client (Client A) that had a query as to whether their workers were actually self-employed or employed. This is a common question we are asked by clients, more so now since the introduction of the IR35 legislation.
Like many tax questions the answer is not straightforward and can depend on a number of circumstances.
So the first thing we do is to investigate the situation, to ask the right questions to help achieve the answer, for example (not exhaustive):-
- Do they have to do the work themselves or can they provide a substitute?
- Do they work a set amount of hours?
- Do they get paid holiday and sickness?
- Are they paid by the hour, week, or month?
- Do they provide the main items of equipment they need to do their job?
- Can they decide what work to do, how and when to do the work and where to provide the service
Once we have had all the questions answered, we will then provide our advice, together with detailed fact-sheet explaining how the decision is arrived at and if IR35 is a factor, information on what this means and how to deal with it correctly.
In the situation of Client A, we looked into the individuals circumstances, checked with the authorities, kept the client informed of progress, whilst we looking into the matter. We came to the conclusion, based on all factors taken into account, that the workers were indeed self-employed and provided the client with the necessary advice relating to this.
If you need help to establish the correct treatment of your workers, whether they are self-employed or employed and how to deal with any tax matters based on the decision, get in touch with the Avanti team who will be happy to assist (08000) 388 799